Willy Walker:
Good afternoon and welcome to a very special Walker Webcast. It is hard to believe that this is the 300th episode of the Walker Webcast. I think back to the depths of the pandemic, or the start of the pandemic in 2020, when I turned to our then head of marketing, Susan Weber, and said, “We need to talk to our clients.” And she said, “Great, what do you want to do?” And I said, let's do a Zoom call next week. Invited my friend Sri-Kumar to join me. And that was the beginning of the Walker Webcast, which, with this episode, might pass over 30 million views over the last five years. And an incredible group of guests have joined me, including my friend and interviewer today, Evan Osnos.
Evan, it is a real pleasure to have you A) join me, but more importantly, turn the camera on me this time, which is a little unfamiliar space for me. I've done it twice before with my friend Danny Gabriel last year and my friend Peter Cook the year before that. But it is a real pleasure.
And so with that, the one other thing I would say is that there's a lot more to the Walker Webcast than just me. It's the team that puts it together every week. It's the team that finds our spectacular guests and helps me put all this together. And so to everyone on the Walker & Dunlop team, thank you. And the other is to our listeners. I travel across the country and get stopped all over the place by people. I was walking through Boston Logan Airport last week, and a guy walked right up to me and said, I listen to you every week, and thank you for all you do. And it's a real honor. I know, Evan, you get those types of comments from people who listen to you and your webcast and watch you on television. And it's an honor to have the listeners who tune into the Walker Webcast every week. And so thank you to all of you who listen in. And with that, Evan, the microphone is yours.
Evan Osnos:
Thanks, Willy. And thanks for the idea of doing this. This is a pleasure for me too.
As you mentioned, I've been on the other end of this before. You and I go back a number of years. And interestingly, and some of your viewers will know this, what I know about real estate fits on a postage stamp. That's not why you and I are friends. We're both interested in interviewing. We're interested in leadership and how things work, how systems work. And this is a chance today, as you say, to turn the camera, to turn the tables a bit. And I think there are a huge range of questions that have come in from people who are interested in the work you do, but also some of the things you've learned over the course of this process, first the 300 episodes, but also more broadly over the course of your career. I have questions of my own.
One of the joys of being the interviewer today is the prerogative to start with something that has been on my mind for a long time. And I think it is probably something that is of interest to many of your friends and listeners and viewers, and probably even competitors, which is the question of how you do everything. I mean, I know that sounds like a generic question, but I think people know, Willy, that you consume a lot of information. You get a lot done, both in your professional life, in your sort of information life. And you also think about how to stay happy and healthy and all the rest of it. All of us.
And this is now me talking as I approach 50, think about the systems of our lives and how do we figure out how to make use of every day. And I am really interested. I find that I'm increasingly interested in hearing about how people organize their choices every day. Just literally, how do you start your day and make the decisions about how you spend your time? And what do you find has worked for you as you continue to build new things into your day all the time?
Willy Walker:
When I was applying to Harvard Business School way back in the day, Evan, there was an essay that you had to write, which was described, “The Day in Your Life.” And so I sat there and tried to put everything into that essay that would make it seem that I was worthy of going to Harvard Business School. I got to make sure there's exercise. I got to make sure there's mental stimulation, a lot of hard work, and a bunch of other things.
I would say to you that it was probably 90% accurate. I think I probably sat there and tried to puff up a little bit about what I was doing on a day-to-day basis. But I think back to that when I wrote that, exercise has always been part of my life and has been a key piece of my physical and mental health. And I was fortunate to play college lacrosse. I was fortunate to be a fast runner and got into marathoning and then got into triathlons, but general cardiovascular health has just been part of my life. I do it pretty much every single day. And whenever I speak to college students, I always talk about just creating the habits, the habits that you can carry with you. And most people, like I, when you start having kids, when you start having a career, your time gets crunched and there's just not enough time for it. And it kind of falls to the wayside. And then all of a sudden you find yourself sort of 10 or 15 years later where you can maybe work it back into your schedule, but you've lost the habit. You've lost the rhythm of doing that. And I was fortunate not to lose it.
And so I think that first, from a mental and physical health standpoint, has been sort of the cornerstone of part of my life and I make time for it every day. I think the other piece to that, just as an aside, I wear this WHOOP strap, Evan, that tells you your WHOOP age. And when I turned 59 years old this year, I wanted to get my WHOOP age into my forties before I turned 60. And so this year I've been very focused on health and wellness; I stopped drinking, a bunch of other things. And I'm very pleased to say that this past Saturday (the WHOOP age updates on a weekly basis), I got to 50.0 years old at my WHOOP age, which means that this coming Saturday I will dip into the 40s, as far as my WHOOP age. Which means that I've kind of accomplished something I wanted to do, which was to take, not my biological clock or my calendar clock, but I guess my biological clock and move it backwards by a decade before I turned 60. And I think that's reflective of the focus on health and wellness.
The other piece to it is just information. I think you and I have talked about this before, but I went to St. Lawrence undergrad and had a bunch of friends who went to Harvard like you and sort of had this chip on my shoulder as it relates to, they were all smarter than I was. They went to better colleges than I did. And it sort of created not only a chip on my shoulder, but this desire for information, this desire to be knowledgeable. And so I became a voracious reader. And I read more books out of college than I read in all of high school and college. And became a really, really big reader of both novels and nonfiction, as well as just daily periodicals in the New York Times and the Wall Street Journal. And I'm asked often, Evan, where I get my information from on a daily basis. And I did something last week with our tech team that I thought was really interesting, where they wanted to figure out what data streams I track to be able to figure out my view of the markets. And we sat there with them saying, okay, show us what you look at on your phone, show us what you look at from an email standpoint, show us what you look at from an industry trade rag standpoint, and we'll try and pull all that together. And it was a really interesting exercise because what it told me was that the information that I pull in is from a wide source of data and it takes a certain mind, which you have as well, which has been trained over decades that knows what's sort of real and what's Memorex, to go back to the old commercial that you and I both remember, what's real and what's fake and being able to sort through it and put it into context. And I think that that's a very important piece to what makes me so curious.
Final thing I'll say to turn it back to you, a very long-winded answer. But my father has one of the most curious minds of anyone I know. And my father, at 87 years old, is always filled with questions and information for friends of mine. And I know plenty of 87-year-old people who are wonderful people, but they may not have the curiosity of mind that my dad still has at 87. And I clearly inherited that from my dad. And it's one of the great gifts my dad gave me. And I think that that's something that also kind of stimulates me to consistently and continuously learn more.
Evan Osnos:
Yeah. I was really struck by that element of your life, this kind of persistent curiosity. You have your mother, Diana, who was a journalist, of course. Some people will know that. That probably fed a certain awareness of the world and a desire to learn more. I happened to be, yesterday, just to build on this point about consuming different data streams. I was at a memorial service for Alan Greenspan. And one of the themes that came through in the eulogies from people who really knew him well was that he had lived through these different eras of information technology. And towards the end of his life, he had, of course, a Bloomberg terminal that allowed him to get anything all the time, anywhere.
And it was like a kid having a feast because all of a sudden he could go on and say, I can get Australian coke prices with a touch of a button. And I think people who wonder what it is that makes somebody able to come up with what are these large assessments of broad trends, the kinds of things you have to do in your work all the time, or Alan Greenspan on a whole other level when it comes to trying to manage the Federal Reserve. It's how you take these data streams that might seem obscure. And one small thing can actually change your whole perception of things that everybody else has available to them all the time.
In a way, what I hear you saying is, yes, you have to consume the newspapers that everybody is reading, but you are also on the lookout for these more obscure things. It's part of the reason why you've interviewed me over the years. It's not as if what I'm doing every day necessarily is relevant. But it sounds to me like you've decided through that combination of innate curiosity and then practice that you never know where the insight is going to come from.
Willy Walker:
Just one quick anecdote, because you raised Alan Greenspan's name and I hadn't. This wasn't on my bingo card for our conversation this morning. 1992, John Heinz, a senator from Pennsylvania, tragically dies in a plane crash. My family has been very close family friends of the Heinzes for years. I came back from Paraguay for Jack's funeral. And it was at the Washington National Cathedral.
And we're standing in the back of the cathedral. And every member, every senator, was lined up for us to proceed in. And there was one person in the line who had probably 20 senators circling around him, and I couldn't see who it was in the middle who had gotten all the senators' attention for them to sit there and listen to what he was saying.
And I moved over to the side and looked through, and I saw Alan Greenspan standing there holding court with 20 or 30 U.S. senators all listening intently to what he was saying. And to be honest with you, Evan, I didn't understand at that age and at that time how influential the Federal Reserve was. And then all of a sudden I saw Alan Greenspan sitting there holding court. And I said, OK, that's a pretty important job. Anyway, just an anecdote from some, jeez, almost 30 years ago, more than 30 years ago.
Evan Osnos:
Well, it's relevant, in fact. And just a final note on that, because it leads into the next question, which came in from the public, which is one thing that people may not know about Greenspan unless they are readers of his biography, was that he had these multiple chapters of his life. He was a jazz musician. He went to Juilliard, all before he became the economics wizard that everybody knew.
That leads to this issue, this question of personal and professional reinvention, this idea of life moving in chapters. One of the questions that people sent in is about you, Willy, on that question, which is: You've been through these periods of personal reinvention. You've changed the company. You've changed, in many ways, your role over the years in a whole variety of ways.
They ask, what did you learn about yourself that you didn't know before? And where do you draw your inspiration when thinking about what comes next?
Willy Walker:
The personal reinvention, I think, comes from the school of hard knocks. I think that challenges, difficulty. When things are going great, I think back to days when everything was sort of roses. And you don't stop and all of a sudden shift gears when everything's going great. It's when times are tough, when you've had personal loss, professional loss, whatever the case might be, that requires you to dig deep, really look at what you were doing or what your organization was doing, and assess what the path for the future is. And the end of my marriage was a time where I really looked deep as it relates to who I was as an individual and what both the joy I'd had in that relationship, as well as the errors and mistakes that I'd made. And it was requiring me to chart a new course.
When my marriage came down, I assessed my relationship with my boys. And I think one of the things that I very clearly understood at that moment was that I was raising my boys to be the boys that I wanted them to be and not the boys that they wanted to be. And so that shift from parenting them for who they wanted to be, not the vision that I had for them, was a fantastic and, to this day, one of the most important shifts in my life as it relates to parenting and the relationships I now have with my boys.
I wouldn't have the relationships with my boys today had I not had that moment to look, to reflect, to analyze, to figure out that I was doing it wrong, and then to kind of change course. It's unfortunate, quite honestly, that a lot of the great learnings come from those hard moments in life. But I think the other piece to it is being able to have the, I would say, courage to look deep and then also be vulnerable to be able to talk about these things.
I spoke at the University of Michigan last Friday and was talking all about real estate and cap rates and all sorts of very antiseptic stuff. And a student asked me how I'd grown Walker & Dunlop to be the company it was and how I'd done all these great things. And I kind of went deep on things that we hadn't done right. And all of a sudden, I opened up some vulnerability to this student. And then the next question was a personal question about me. And I opened up again. And you could just tell the audience really moved towards me at that moment, Evan. They'd heard all this stuff about where the markets are. Who cares?
Honestly, I mean, I know they were there to learn something. And hopefully, they did learn about cap rates and multifamily and the housing market. But at the end of the day, I think the most important thing that they took away was when I was vulnerable about mistakes I've made, both personally and professionally, so that they could learn from that. And I think that that does take some courage. And it also takes some confidence in who you are as a person that you can accept the fact that you do make mistakes. A lot of people, me included, when I was younger, wanted no one to ever think that there was anything wrong about me, that I was always the smartest and the fastest and the best.
As I thought about what I said last week at Michigan, I thought about saying to the students, get out of being best, fastest, smartest, and move more towards -ing, living, being, loving. And move from the -est to the -ing. Obviously, these kids, young adults, are 22 and 24. They're ready to pound out on their own. They want to be the best. They need to be the best. They need to get the best job. But I think what they heard from me was: that life that you're thinking about living is not going to be from the bottom left to the upper right on a straight line. It's going to have some ups and downs to it, and be ready for them.
Evan Osnos:
Well, a theme in that answer is something that I've become more aware of in my own life, which is this question of when do you accept conditions as they are or people as they are, including people you love or maybe not people you love? And when do you push, and when do you seek to change? It's this, look, it's at the core of the Serenity Prayer, right? What do I decide I must change? And look, you wouldn't be where you are in your life and your career if you accepted things as they were. You've constantly seen opportunities where you can go in and say, I can push here. I can make a change. I can achieve this thing that I think is worth doing. But then there are these other things where you have to accept them. And that is a source of ancient wisdom, right? But I'm curious, how do you balance these two things? Where do you decide I'm going to accept this versus I'm going to rage against the constraints and the boundaries of this and see if I can alter this condition?
Willy Walker:
It's really tough because, as you know, we both pushed on things that we shouldn't have pushed on. And we both accepted things that, potentially, in hindsight, we look back on and say, man, I wish I hadn't just sort of accepted that and wish I'd worked a little bit harder or pushed a little bit harder. It's interesting because one of the questions that came up at Michigan was a student asking about how I pack everything into my days. And I just basically said to him, you've got to be careful you don't pack too much in. And I went back to 2012. And I said in 2012, I'd just taken Walker & Dunlop public. I had three boys under 10. I was chairman of the board of three public companies. And I decided in my free time that I was going to train to go to the Olympic distance triathlon national championships. And I came in fourth. And I said, when you pack that much into your life at one time, something is going to break.
And so here I was trying to show everyone that I could do everything simultaneously. And as I said, in that moment, I said my marriage ended up being the thing that failed. And unfortunately, I was very open and straightforward about it. And I just basically, what's interesting about it is that one of the Michigan students in the audience wrote to me over the weekend. And he said, I heard you talk about jamming everything into your life. And I want the job. And I want a family. And I want this and that. And I've got a woman I'm dating right now. And I just don't know if I have time for her.
And I want to know whether I should stay with her or not. And I wrote this young man back. And I said to him, I know you want to do everything. I think you probably have time to have a woman who you might be thinking about creating a life with in your life. And if you don't, you might want to think about how hard you're working. But I think at the end of the day, Evan, you do get to a point in your life where there are certain times where you really feel like you have to push, where you really feel like there's something that's either worth pushing for, or something that means enough to you that you can't let go of it.
And at the same time, there are also those times where if you push too hard, it's going to just break. And it's funny, because you can't learn that in a textbook, as you well know. There's no course on that at university that says, “This is when you lean in, and this is when you back off.” And I very clearly know when I sort of burnt the bacon, if you will, and pushed too hard.
I think the one other piece to it is knowing when you can take risks. There have been three times in the history of Walker & Dunlop where I decided the company was going to take somewhat unprecedented risk to get something done. And fortunately, in all three times, it worked out for us. But as I think back on it, what would have happened if it had broken the other way, it would not have been catastrophic, but would have set the company back dramatically. And yet, everything had lined up to the point where I felt like it was a calculated risk that I was willing to take at that time.
But unless you're willing to take those types of risks, you're not going to be able to create the type of growth and value that we have created. Unless you're someone like Elon Musk or Steve Jobs who just has a mind that is fully different from most other people. But if you're trying to kind of hustle and outwork or put the effort in to just grow a company that's in a pretty traditional standard industry like we are, you're going to have to take some risks throughout that trip that are going to require you to say, “Now's the time to lean in,” and to be ready to take the consequences if it doesn't go your way.
Evan Osnos:
Walk me through an example of that. Let's make that concrete. I don't want to go too far down the rabbit hole. But help me understand what that looked like to you. What was the choice? What were the stakes? And what did you understand at the end of that decision about risk that you may not have even appreciated at the beginning?
Willy Walker:
When we were going to buy a company in 2012, and that company was a great company owned by a private equity firm, and as we were doing the deal negotiation, there were three very big bankers at that company that represented a huge amount of their revenues. I think 40% to 50% of the revenues came from these three bankers. We sat there in due diligence and said, we would like to have a force majeure clause in the purchase and sale agreement that says that if these three bankers don't come across in the acquisition, we can back out of the deal.
Well, the private equity firm that was selling us the company said, “Uh-uh, that's on you.” And by the way, we had not been able to meet with anyone at the company. I had never shaken hands with the three bankers, much less talked to them about whether they would want to come to Walker & Dunlop.
We had a very significant decision to make, which was: do we accept the deal without the force majeure contract clause that would allow me to back away if these three bankers didn't come across? We decided, and I convinced our board to go forward with the deal. We announced the deal. And the day that we announced the deal, one of our big competitors put a massive amount of money on the table for those three bankers to move across to our competitor firm. And I said, uh-oh, I may have made a mistake. Over the next three months, as we were closing the deal, we got those three bankers to stay and come across the deal. And I'm very happy to say that the three of them are still at Walker & Dunlop today, 15, 16 years after we actually closed that deal. It's great.
But at that time, had they walked out once we'd announced the deal, I would have been buying a company that was going to lose 50% of its revenues overnight. And so that's the kind of calculated risk you needed to take at that time. Anyone who looked at it from just a purely legal standpoint or potentially from a board of directors standpoint would say, why would you take that risk? And I had the confidence in us, our team, and our ability to retain them that we moved forward with the deal, which was a transformative deal in the history of Walker & Dunlop. But had it gone the wrong way, I would have had some real problems.
Evan Osnos:
That's an example of one where you took the risk, and it worked out. One of the questions that was sent in looks at the other side of the coin. And they say, looking back over your career, is there a decision you regret making or a missed opportunity that still bothers you?
Willy Walker:
Plenty of missed opportunities and plenty of hard decisions that you kind of look back on and say, well, what if that had been a little bit different? I won't spend too much time on acquisitions that we looked at doing. I will say there was one acquisition back in 2013 or 2014 that would have gotten us into the property brokerage business. And I just looked at it wrong. It was a company that had a bunch of licensees to it. And I thought that if you bought it, wrapping all those licensees together would be very difficult. And so I passed on it. One of our big competitor firms decided to move forward and buy them. And it ended up being a wildly valuable acquisition for that competitor firm.
And so as I look back on sort of mistakes or would have, should have, that would be one at the top of the list as far as things that I would have liked to have done and in hindsight probably should have looked at the acquisition in a different way.
Evan Osnos:
I want to shift gears now to some of the things that you've picked up from this process of doing now 300 episodes. One of the things people are interested in is looking back at the guests that you've had on the show.
What do you think, if you had to pick one guest from the 300 episodes that has, as this person says, changed you the most personally or professionally, who is that and how did they change you?
Willy Walker:
You interview enough people to know that you're not supposed to say who your favorite guest is because you immediately offend everyone else who is a guest of yours.
Evan Osnos:
I think that's right. I would say let's frame it slightly differently, which is who are some of the people that have surprised you in the way that they've given you insights you didn't have? And I will tell you, I just was enjoying thinking about this show, listening to your conversation with Amor Towles, who, of course, you've had on before. He's a friend. He's also a novelist. He's somebody who, for me as a writer, there's a huge amount of interesting and surprising information in a conversation like that. I'm curious who has kind of startled you with insights you didn't expect.
Willy Walker:
On the Amor discussion, just one quick thing, and I'm not sure, I'm assuming you've had this same experience, Evan. In the Amor discussion, he started to talk about the creative process and how he sort of thinks as he writes. And I was so enraptured with what he was saying that I sort of forgot that I was conducting an interview. And I just was sort of letting my mind drift off. And then all of a sudden I had to catch myself and pull myself back to, hold it, you have a question that's coming up after he finishes telling you what he's saying. And I was like, whoa, wake up, get back into this, because I was just so taken by the way that he was describing what he was talking about.
I would say that there've been a number of very famous people who've come on the webcast. And I've been very appreciative of their genuineness in the way that they answered questions and gave of their time, if you will. Alex Rodriguez, who I had on, there was no reason for A-Rod to be as caring and as sort of invested in the process and the interview as he was. And I just found this incredible realness to Alex's character that you don't necessarily see when he's on television and when you see him batting for the New York Yankees. And it was just very real.
I would also say that the thing that I found most interesting throughout my 300, 299 interviews where the camera was turned, is finding something that opens the person up that you're talking to, like getting them to share something that they typically wouldn't. And I learned this from reading between the lines. The first thing that I have to go back to is David Rubenstein, the person who I learned how to interview from. David, who runs Carlyle, who still does a monthly interview for the Economic Club of Washington. I would go to those Economic Club of Washington interviews that David would hold, and David would have no notes. And it was very evident that he did all of his homework on his guests just incredibly thoroughly. He was just incredible. And I sat there and watched and said, if I ever interview somebody, don't bring notes; do your homework on them to make them know that you know tons about them as a person. And the moment that you have shown them that you've invested in getting to know them, they will open up and share something with you that's not in the bio, that's not in the book that they've written. And so, I learned that from David and have always tried to follow that type of interviewing style. I'm clearly not the funniest, nor the most insightful or smartest interviewer. But if I've done my homework, I'm telling my guests that I care about them and care enough to know what they are up to and what they've done in their life.
I would also add that every once in a while, I've gotten the conversation to go somewhere that I didn't think it was going to go. So, for instance, with Admiral Bill McRaven, we were talking about a bunch of different things, and I wanted to get to the mission to go take out Osama bin Laden. And I'd watched the tape, however many times on YouTube, of him talking about it. And I said he's told this story so many times; let's start at the end. And so, rather than saying, talk to me about launching the SEAL teams and everything else, I said, “Start the story when you got Osama bin Laden's body back to the airbase.” And what was interesting was, all of a sudden, he said, I've never been asked to start a conversation there. And then he dove into this incredible anecdote as it relates to not having the DNA back to confirm for President Obama that it was Osama bin Laden. The president said, “Hold it, you don't know that it's him.” And he said, “We're waiting for the DNA, sir.” But hang on a second. And he sees a tall private on the other side of the room. And he says, “How tall are you?” And he says, “I'm 6’4”.” And Osama bin Laden was six foot three or six foot four. And he said, come over here. And he said, “Lie down on the ground.” And he said to the others with the body bag, take the body out and put it on the floor. And he laid him next to him. And he was the same length as the private. And he turned to President Obama. And he said, well, Mr. President, I at least know that he's the right height to be Osama bin Laden. And it was just such an incredible story that I'd never heard before.
And I sat there and said, kind of interesting to go not off script, but go to a part of the story that has not been told many, many times and see if he'll open up about it, something that you might learn that's new and different. And sure enough, Bill McRaven not only talked about something new and different, but a story that I'd never, ever heard. And he said, “I'm not sure I've told that story before.” That was fun. That was different and interesting. And there have been a lot of those.
And so I guess, Evan, I'm just really thankful to the people who have been willing to share about themselves and then also tell something about their history that they may not have talked about before, something that people could learn from that is new and different.
Evan Osnos:
That kind of curiosity, which David Rubenstein does project, it's very clear any time we watch an interview that he's just genuinely ravenously curious about the world. And you mentioned your father a moment ago as having a similar kind of curiosity. I'd like to understand a bit more about him. I don't know much about his kind of leadership or how he conveyed ideas to you. Was his approach to be explicit, or was it to just let things seep in through osmosis? Was it a process of sort of active learning, active studying of him? Or how did those characteristics and frankly, as some of us do in families, was there a time where you were kind of trying to distinguish yourself and do things differently from how he did? And did you kind of come over time to appreciate the things that he was doing?
Willy Walker:
There's a lot in there. I'll try and be brief on it. The first is that I think my dad has the same sort of chip on his shoulder that I had as it relates to when he went to college; he went to the University of Virginia, which back in the late 50s, early 60s was not the university it is today. It was a state school back then. And all of his friends were going off to Harvard and Yale. And I think that he carried that same desire for knowledge and learning and showing that he was smart enough to be in the room from having gone to UVA.
Again, UVA is UVA today. If you say you went to UVA now, it's an incredible university. But back in the day, it was a state school. I think the other piece to it is that my dad, as he went through his career, had the opportunity, being in Washington, to engage with lots and lots of uber-uber smart people who were there either serving in government or in the press corps through my mom, who you mentioned previously was the White House photographer for Time magazine. And so I think that he also consistently felt like he needed to bring his best game, if you will, and therefore wanted to be up on everything and know a lot. As it relates to me and wanting to kind of chart my own course from my dad. It's very clear to me as I look back on joining a family company that when I got here, I was way, way too focused on trying to show that I was going to chart a new course and that I was going to be this great leader to take the company to all new heights.
And I have been very straightforward with my dad and others, saying that I sort of ran roughshod at that time over this incredible, small, but very, very successful company that my dad had been leading, and tried to kind of sort of say, oh, Walker & Dunlop was started in 2003 when Willy Walker joined it, if you will. And that's extreme. I never said that.
But the point was that I didn't want anyone to sit there and think that the only reason I was here was because my name was on the door. And I distinctly remember my first industry conference I went to and introduced myself to somebody and they put two and two together that I worked for Walker & Dunlop and that my last name was Walker. And this guy basically said, “Oh, you're part of the Lucky Sperm Club. You get to go work for the family company.” And nothing, nothing could have been more offensive to me, Evan, at that moment than some guy saying the only reason you're here is because of your last name.
And so I was hard-charged to try and sort of put my mark on the company and grow it as fast as I could and sort of not give enough credit to everything that my dad and his management team had done to build this fantastic company that I was fortunate enough to step in and then take forward. And I give him incredible credit that he allowed me to act like an arrogant, ambitious, hard-charging CEO at those times and not sort of put a bridle on me and say, whoa, Seabiscuit, it's time for you to slow down here a little bit and make sure that you're giving credit to those that deserve credit for the fantastic platform that you were so lucky to step in and lead.
But fortunately for us all, we have taken W&D to lots of new levels as it relates to size and growth and value. And that's been very beneficial for both him and for me. But I give him a lot of credit for letting me, to some degree, act like an obnoxious, arrogant jerk for a period of time when I first joined the company.
Evan Osnos:
I think that's our parents' obligation to us to some degree. But perhaps we only come upon that realization when we're parents ourselves. To that point about the thresholds that the company has taken, one of the questions that has come in that people are very interested in is around the decision to go public.
And how did you decide that the company was ready to do so? And was there anything that you underestimated about the experience of becoming a public company?
Willy Walker:
Everything. I mean, we were the first mortgage company, commercial or single-family, to go public after the great financial crisis that was caused by mortgages. Just kind of try that one on for size. The first company to go public after the great financial crisis that had anything to do with the mortgage industry after the GFC. First of all, you had to have a lot of chutzpah to just sort of say, let's be the first one to try and go out. The second is that I didn't realize that the world really did not need a $220 million market cap commercial real estate mortgage company. I thought, hey, this will be great and fun. Let's go do it. But I had no understanding of volume and liquidity and market cap, so that at a market cap of $220 million, you really couldn't get the Fidelitys and the T. Rowe Prices of this world to invest in a microcap IPO.
They did end up investing in the IPO. But it takes a lot of work to get a Fidelity or a T. Rowe Price to invest in a $220 million market cap company that, oh, by the way, has a lot of family ownership as well as at that time we had a lot of ownership by Credit Suisse because we'd bought a company from them. There really wasn't a lot of liquidity in the stock, which meant that essentially, even though we were publicly traded, you really kind of couldn't get in and out without moving the stock price up or down dramatically.
But for the first 14 years as a publicly traded company, we outgrew and outperformed all but Apple in the Mag 7 from 2015 to 2020. I mean, we had this incredible history of adding market cap and growing and growing. And so over that period of time, we were doing exactly what shareholders wanted. Everything was great. We were growing the company. We were adding value.
Everything was really just cranking along.
The last two years have been really tough. We've lost a lot of market cap. We're in a cycle right now where interest rates are very high. Volumes have come down. And now's the time when you really need to kind of hunker down and move through these times. Make sure that you're innovating appropriately. Make sure that you're keeping the team together. Make sure that even though the aggregate market may not be growing at the rate you want it to, you're gaining market share. All of those things that are hallmarks of enduring companies. No company is going to go from the bottom left to the upper right. I mean, even Nvidia for the first decade of its existence wasn't a great stock to own. Obviously, if you've owned Nvidia since the beginning, it's now worth a tremendous amount of money. But all companies go through various cycles.
You remember when Meta was trying to get its handheld or online strategy going, and everyone thought that Facebook was going to have a tough time getting its media and ad sales business up and going, and its stock fell off, and then it obviously came back. We're in a kind of a retrenchment period right now and really focusing on what creates shareholder value in the long term.
And so you look at times like today and you're like, this is what you get paid for. This is where you really hunker down and get the team moving in new ways, and you really think, and you innovate at times like this. And then at the end of the day, as being a publicly traded company, it's been great for us and it's been great for our shareholders.
And so on that market, it's done very, very well. The final thing I would say is that when we went public, Evan, the private markets, while robust at that time, private markets have grown tremendously over the last 16 years, right? If I go back and say, would you have gone public in 2010 if the private markets had been the way that they are in 2026? Probably not. There's enough private capital out there that we would be owned by a private equity firm or something else. But that was the option that was in front of us at that time to kind of recap the company and it certainly worked out for us and our shareholders.
Evan Osnos:
Well, to that question of there's always a world that we inhabit at the moment, and then we can look back on it. And you've been candid today about looking back on some of the choices and decisions that you've made in your life. I'm curious about if you take the world today, and we've gotten questions on this, are there assumptions that you see out there? Is there a kind of consensus view, a received wisdom among commercial real estate investors or lenders that people are making today that you look at and you think, I really suspect people are going to regret this in five years? What is the thing that you hear people say today and that little bit of your mind says, I'm not sure that's right?
Willy Walker:
Well, I would say that since the Federal Reserve started tightening back at the end of 2022, which was the first Fed hike of 75 basis points, and I believe December of 2022, there has been a lot of hope in our industry that rates would go back to where they were. And so from 2022 into the start of 2023, there have been people sitting there saying, well, it's going to go back to where it was from 2010 to 2023, it's going to go back to a low interest rate environment. And I think that right now, Evan, a lot of people are sort of switching from the hope trade to the fear trade. They're going from, I was hoping that rates were going to go back down, and I don't think they're going to. And now I've got to be really fearful that they go up from here. And I just had a client who we did a financing for about four or five months ago, and the all-in coupon rate was a 5.03% 10-year mortgage. And he wrote to me and said, boy, that 5.03% is looking really good right now. And so they were smart to have moved then. And maybe they were just lucky. Maybe the refinancing just came up at that time. But I do feel that we're moving from a hope trade to a fear trade. And there are a lot of people sitting there saying, well, if the 10-year Treasury goes from 5.25% up to 6%, what's that mean for my refinancing that's coming up in a year or two from now? And they're looking at whether now might be the time to go and refinance that loan so that they're not caught in a higher rate environment a year or two from now.
I think the other one, I listen to the All-In podcast on a weekly basis. I think that those four are as insightful on AI and technology as any podcast or writer or reporters you can get. I'm not a big fan of them when they get outside of their lanes. They like to talk about politics and a bunch of other stuff. And I'm like, stay in your lanes. You guys really understand AI and technology. But when they're in their lane, they're as good as they get. And I listen to what they're talking about as it relates to the evolution of AI. And I think there's a lot of writing on the wall that these hyperscalers that their business model is going to fundamentally change.
Just this last week, Evan, they talked about the fact that the leading-edge models had 80% market share 90 days ago and that the open-source models had 20% market share 90 days ago. And this is their data. And they said it has in the last 90 days completely inverted. And now it has gone from the cutting-edge models having 20% market share and the open models having 80% market share. And I sit there and think about someone like Anthropic’s revenues that have just grown hand over fist to get to a $100 billion run rate. And I say, yeah, and they've been charging a premium price for tokens. And now people are sitting there saying, I can go to an open model and either not pay at all or I can go pay a significant amount less.
And I wonder about all of the compute power that these hyperscalers have signed up to. And I wonder what they're going to have to pay as it relates to their lease rates for that compute power. And at Walker & Dunlop, for instance, we have a closed environment with OpenAI. We love OpenAI. We use them and love all the protection that they give us. But at some point, if these open models are going to provide us with 90% of the compute power that we get on OpenAI, we're not a biotech company trying to solve cancer. We don't need those leading-edge, bleeding-edge models to be able to run a mortgage company. What we need is really good technology that then gets adopted by our people to make us more efficient and more insightful.
We don't need to be at that bleeding edge. So when the economics of being on a bleeding-edge model versus just a model that gives us everything we need, I'm going the cheaper route. I and other CEOs around the world are going to go the cheaper route. I just, right now, I'm kind of putting a question mark around things like Anthropic’s valuation goes from, I think it's at $1.6 trillion on their IPO right now, people talking about a $2 trillion price talk. But as David Sacks said on All-In this past week, if they lose their six-month advantage over the rest of the market, these are his words, it goes to zero. $1.6 trillion company, and he said it goes to zero?
I just think that there's a lot out there to be looked at. And you and I are old enough to remember the dot-com bust where everyone sat there and said theglobe.com is worth X millions or billions of dollars. And then the next thing you know, it goes to zero. And so I'm a little bit skittish on that. The one other thing that I would say to that, and I'm trying not to talk about my own book, but if there is any fall-off in the AI marketplace and valuations that leads to a recession, rates likely come down. And that favors commercial real estate, where rates would come down, and that makes it so that we get a lot of liquidity back in, and all that refinancing that I'm talking about our clients going from the hope trade to the fear trade makes it a lot more affordable for them. And so I want to be very clear and transparent that that wouldn't be a bad outcome for the commercial real estate industry. It's not like I'm hoping for a recession, but were there to be some bloom off the rose as it relates to the AI trade, it probably is net beneficial to commercial real estate.
Evan Osnos:
Stay on AI for just a second here, because I think the other piece of the puzzle, and it is part of this very uncertain field of the future that we're all looking at, is about the labor force. And particularly, let's put it in very specific terms. If you were a young person today, and you and I both know young people coming out of school and they are walking into a world that is extremely hard to predict, how do you talk to somebody that age, 22, 23, who's trying to decide, look, how can I make myself employable and useful when it's really hard to know what a career is going to look like in 10 years?
And look, we can always say, okay, it's always been hard to predict. There's always been changes. But for all obvious reasons, right now, it really feels like a moment when it's hard. What do you think about it? And how would you advise a young listener or young viewer to make choices?
Willy Walker:
First, no job experience is a bad job experience. Make sure that they're learning. I learned more from an awful CEO I had for five years of what not to do as a CEO than I did what to do. But that's extremely valuable to learn what not to do as a CEO. And so always keep your eyes open, always be learning, because even the worst job experience you're ever going to have, you're learning something about what not to do if you ever get in a management position or you ever want to build your own company.
The second thing is that it is moving so fast that I don't think there's any way to make a clear bet right now on what the world looks like a year from now, what the world looks like 10 years from now. There are clearly growth industries in areas that are going to grow and provide opportunity for you. But I mean, I remember distinctly when I was at business school and graduated in 1995, a lot of my buddies wanted to go into private equity. My roommate wanted to go into private equity. Private equity in 1995 was still a cottage industry in comparison to where it is today. And there were a handful of firms at that time who had a couple billion dollars under management, like KKR, and Carlyle had just started. We talked about David Rubenstein at this point. David, I mean, Carlyle was a teeny firm in 1995 and has grown into this behemoth. If you got that directionally right to go into private equity in 1995, you've had an incredible run. And so I think that finding those growth industries, those growth areas of where capital is going to flow is super important. You don't want to be somewhere that the capital is going the other way.
And then the final piece to it is that there's been this big argument that AI was going to get rid of jobs. So far, AI has been nothing but net beneficial. It's been adding jobs. It's been adding people. You're clearly going to get a reallocation in companies where a computer can now do this. We need people to do that. But I sit there on Instagram, and I am already getting tired of looking at fake stuff. I want to be real. I mean, I'm glad that someone sat there. The funniest video I saw was about the state dinner last week, where somebody had spent all this time putting together all these fake pictures of what went on at the state dinner last week. And I was sitting there saying, wow, that's really quite something. It was fun to watch, but I knew that that was fake. But it drives me nuts when something I have to sit there and really think about is, is that a fake or is that real? I want to be real.
And I think that humans are going to continue to want real; they're going to want real experiences. It's one of the reasons why travel and leisure, I think, is going to continue to grow over the next 5, 10, 20 years is because people want experiences. Why are concerts selling out all over the country? Because people want to experience something real. They want to be there. They want to be face to face.
And so I think that if you're going to say that computers and technology are going to do away with certain life experiences, they're also going to heighten other life experiences. And so if you're trying to figure out which career to go into, figure out that one that's going to heighten life experience, and that's going to have opportunity, it's going to have pay, and it's going to have the opportunity to learn and earn. And that's the final thing I'll say on that is that just find a place where you can learn and earn. And I have always been one that puts more emphasis on learning than earning. My first job out of college and my first job out of business school, I passed up much, much more lucrative opportunities to go somewhere where I learned more than I was going to earn.
There are plenty of people who look at it the inverse. And they went, I'm going to go earn as much as I can and kind of push down on the learning side. I've always been one to chase after the learning side, and it certainly has benefited me in my career.
Evan Osnos:
Absolutely. I would say the same. I think, in just a second, I'm going to turn to a lightning round of questions because there are a few that have come in that I think people would get a lot out of, and I'll force you to answer succinctly.
But before we do, here's another one that has come in that I think is one that you'll want to talk about, which is women have remained underrepresented at the senior levels of commercial real estate. What do you think leaders in the industry need to start doing, need to stop doing, or measure differently in order to change that?
Willy Walker:
We've always had a big focus on making Walker & Dunlop a company that presents huge opportunities for women and minorities. And we remain focused on being a company that tries to identify the very best talent and give them the opportunity to move up, learn, earn, and manage more. And I think that focus has benefited us over time. I would put forth that commercial real estate, because it is a relatively slow industry, and when I say slow, it's that transactions are to buy a building and hold it for 10 years or 30 years, to build a building and hold it for a long period of time; there's not a ton of velocity in the business.
And as a result of that lack of velocity, it's been an industry that's been hard for women and minorities to break into. Ownership of assets has predominantly been by white males, and white males have predominantly gone and hired people who look and act and went to school at the same places that they do. And so, I think there's a huge opportunity for Walker & Dunlop and other companies to do better at finding talented women and allowing them to be promoted and working with them to be promoted.
Evan Osnos:
The first question in this lightning round, Willy, comes from somebody who clearly has some information behind it. And this is one that I'm particularly interested in as a consistently terrible hockey player. This person asks, why are you so fierce on the ice hockey rink?
Willy Walker:
Yeah, Evan, it goes back to what I said about 2012 and wanting to show everyone that I was the best. I was the fastest. I was the strongest. I remember playing men's hockey in Washington back in 2012, and you didn't want to be on the other side of me. And as I look back on it, I'm like, dude, it's men's hockey. It's men's hockey. Who cares? Everyone's out there having a good time.
Evan Osnos:
People who actually play it, as you know.
Willy Walker:
Yeah, but man, oh, man, I remember winning the pond hockey tournament in, I don't know, 2013 or 2014. And we were in the finals, and I had a partner who was not nearly as good as the other two guys we were playing against. And I just took the whole thing into my own hands and went and basically beat two guys, two-on-one. And I looked back on it, and I came off the ice. And I'm sure a lot of people sat there and said, why does this guy take all this stuff so seriously? Who's he trying to prove something to? And it was to myself. And it was, in hindsight, stupid. But I was pretty fierce on the men's pickup hockey rink.
Evan Osnos:
All right. A question here, which also gets to, perhaps, motivations and underlying unresolved questions for yourself, which is about Burning Man.
Somebody asked, what was your motivation for going to Burning Man? And did you find what you were looking for?
Willy Walker:
I got to, just real quick, you and I both know Arthur Brooks. And Arthur Brooks, who wrote one of the great books called From Strength to Strength, which I recommend to anyone who's going through mid-life and what they want to get in the back half of life, I told Arthur that I was really good on almost everything in his book except spirituality. And so Arthur called me up and said, I'm going to go meet with the Dalai Lama. Would you like to come with me? And two years ago, I grabbed my youngest son, and the two of us hopped on a plane and flew to India and went and met with the Dalai Lama with Arthur. And it was this incredible experience.
But I came back and everyone was like, did you find what you were looking for? And I was like, no, the spirituality has not come raining through my body. And at the same time, it was still an incredible experience. And meeting His Holiness was one of my life events. But it didn't get me tuned in there. As it relates to Burning Man, Burning Man, I'll use the same sort of comment that I said previously: Burning Man was not on Willy Walker's life bingo card, if you will, of experiences that I was going to have. But my ex-girlfriend said, “Let's go to Burning Man.” And I said, “Great, let's go do it.”
I found Burning Man to be unbelievable. I found it to be beautiful. I found the music to be eye-opening. And the people that I met and their attitudes towards everyone there were just so warm and accommodating and accepting. I loved everything about Burning Man. I think I'll go back someday. I didn't go back this year. And I don't plan on making it an annual trip. But I now understand when people go to the desert, what that experience is like and why it is so unique. And I will also say one thing that many people don't know is that it is just stunningly beautiful when you're not in the midst of a sandstorm or a rainstorm. It is really one of the most beautiful places you'll ever be.
Evan Osnos:
There's a documentary about it, which I've watched part of. And so far, it's the closest I've ever come. Here's another question, which is: you read a lot. You talk to a lot of people about books. If you were going to write a book, what would you title it? A book about yourself.
Willy Walker:
I'm writing something right now. I don't know if I'll ever have it see the light of day. But it's called Letters to Mom. And it comes from an interaction that I had with the late Vernon Jordan the summer before I moved to Paraguay when I was 22 years old. I was headed to Paraguay, and I saw Vernon at a cocktail party in Martha's Vineyard. And Vernon said, Willy, you're going to Paraguay.
And I said, I am. And he said, you got to do me a favor. And I said, what's that, Vernon? And he said, you need to write to your mother every week. He goes, that's the one thing I ask of you, is to write to your mother every week. And back then, most people listening to this who are younger than you and me, Evan, you're younger than I am, don't remember that back in 1989 when I moved to Paraguay, not only was there no email, not only was there no internet, but you actually couldn't even afford to call back to the United States because the phone calls were so expensive.
And so as a result of that, the only way you could communicate was through snail mail. But I wrote my parents a letter every single week and sometimes more than every week. And my mom gave me those letters recently and gave me this huge stack of all the letters that I'd written to her. And so what I've done is I've gone and looked through a number of the things that I'd written them about and thinking about it as it relates to life experiences, as well as management experiences that I've had from Paraguay to today. And the title would be Letters to Mom. And I think that that's both a tribute to Vernon for getting that into me and writing, but then also the role that my parents have played in my life as it relates to giving me great experiences and being such important parents and figures in my life.
Evan Osnos:
And good life advice for other young people out there who might be listening. I will tell you, just the last question here is one that was asked in a variety of forms from various listeners and viewers. And this is a question about whether you'd ever think about a life in politics after Walker & Dunlop. You, after all, grew up in Washington, D.C. What do you think? Any interest in elected office or public service of some kind?
Willy Walker:
It's always been something that, having grown up in Washington, D.C., I grew up, if you grew up in New York, typically the bankers or your kid, you look up and someone's dad or mom is an investment banker, and you're like, oh, that's the thing I want to do. You grew up in Hollywood, and they're actors or directors. And that's what I want to do. In D.C., the industry, as you well know, Evan, is sort of politics. I always looked at that as something that I would like to do. And I've always had a keen interest in it. And then I've also been fortunate to lead a number of organizations, both private sector as well as public sector, and enjoyed doing that a great deal.
I am very happy as the chairman and CEO of Walker & Dunlop today. But I have always thought that at some point I might want to give back in that way. And whether it's through elected office or serving in someone's administration, as you know, I have a bunch of friends who are national figures, if you will, as it relates to people who might someday be in Washington.
And so if someone asked me, “Come serve in my cabinet,” would I consider that? Certainly I'd consider it. But I do think right now we do need good people. And I'm not saying that I'm one, but I'm speaking generally about politics. We need good people from both sides of the aisle to step up and come in and lead this company, this country forward. We need really good people. It used to be a really honorable profession. It used to be a profession that people were exceedingly well-educated and lived their lives in a way of both. Yeah, they had ego. Yeah, they wanted power and influence, but they also wanted to do something to make this country a better place. And I have to say that on both sides of the aisle, it feels that a lot of people who are in elected offices today have sort of lost that thread.
And so I have always thought that if I were to go do that, it would be to try and make a real difference. And so we'll see. But as I said, at the top of that question, I'm very happy in my current job and have no intentions of leaving it today.
Evan Osnos:
Well, Willy, if you do find yourself coming back to Washington, we will welcome you here. I may be a little weary of welcoming you back on the hockey rink now that you've learned this information, but it's been a treat to spend some time with you today. You've been candid. I'm grateful for it. And I'll turn it back to you in just a second for a final thought. And you can wrap us up here. But I think both of us have learned a lot over the course of the last 30 years of work. And even if your wristband is telling you that you're edging into my territory here in the late 40s, I just want you to know I'm coming up behind you. If you hear hoofbeats, that's why.
Willy Walker:
So, Evan, honestly, I can't thank you enough. To have someone of your skill asking me questions feels a little overwhelming, to be perfectly honest. But I'm appreciative of your time. I'm very appreciative of your friendship. And I would just reiterate to everyone who's tuned in today. I hope you found this interesting. I have the camera turned on me with some amount of trepidation in that. I started this trying to feed our clients real information on the world around us.
And one of the main reasons I've had guests on the Walker Webcast for 300 episodes and not myself or Walker & Dunlop employees is because I wanted this to be about the world we live in and not about Walker & Dunlop or about me. And so I accepted my team's suggestion to do this somewhat reluctantly. But it's an honor and a pleasure, Evan, to have you ask the questions. And I appreciate everyone listening to the 300th episode. And I look forward to seeing all of you on the 301st when we do that in another week's time.
Thanks, Evan.
Evan Osnos:
My pleasure. Thanks, Willy. Take care.
